Buyouts represented around 40% of overall volume of technology investment in 2003, according to a report from PricewaterhouseCoopers Global Technology Industry Group. The European Technology Investment Report revealed technology private equity investments in Europe up by 2% to €5.4bn. There were 4,811 investments made in the technology sectors (communications, Internet, computer software and hardware, semiconductors, other electronics-related, medical instruments/devices and biotechnology), remaining almost static compared to the 4,819 in 2002.
The number of investee companies however was down 14% on 2002 at 3,325. Technology represented 46% of all private equity investments in Europe by number, down from 47% in 2002.
In addition, 91% of technology investments by number were made at the early and expansion stages, representing 57% of the total amount invested in technology companies down from 68% in 2002. Investment in technology MBOs and MBIs rose by 36% to €2.1bn. As a result, the proportion of technology private equity investment going into buyouts rose from 29% in 2002 to 39% in 2003.
Computer software remained the single largest sector, with total investment of €951m or 18% of total technology investment, narrowly ahead of communications carriers at 17% (€899m.) Computer software also led in terms of number of investments, at 28% of the total, followed by biotechnology at 14%.
The UK led the way in terms of European private equity investment in technology, with total investment almost doubling to €2bn, up from €1.1bn in 2002. France, which topped the list in 2002, slipped to second place with €954m, down from €1.2bn. Italy with €495m claimed third place ahead of Germany at €414m.
The UK also had the most deals at 1,148, followed by France at 987 and Germany at 516. But the UK invested 42% at the venture capital stages compared to France’s 67%, and Germany and Italy’s 57%.